Week 06 Problems Principles of Finance

Listed below is the current data for ABC Company:

ABC Company Balance Sheet December 31, 20xx

10,000,000

  

Total$705,000,000

Assets	Liabilities and Equity
Cash Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper	$	10,000,000	Accounts Payable	$20,000,000
Accounts Receivable	250,000,000	Long-term debt	400,000,000
Inventory	120,000,000	Common Stock ($10 par, 1,000,000 outstanding)
Plant and Equipment	325,000,000	Paid-in capital	90,000,000
Retained Earnings	185,000,000
	Total		$705,000,000

The current price of a stock is $58 per share.

Required:

 

1. Construct a balance sheet after a two for one stock split. What will be the new price of the stock? (Problem 1 tab)
2. Construct a balance sheet after a 5% stock dividend. What is the new price of the stock? (Problem 2 tab)
3. Construct a balance sheet after a one for two reverse stock split. What is the new price of the stock? (Problem 3 tab)
4. Construct a balance sheet after a $3 per share cash dividend. What is the total cash dividend? (Problem 4 tab

Problem 1

$0

ABC Company

Balance Sheet

December 31, 20xx

Assets

Liabilities and Equity

Cash

Accounts Payable

Accounts Receivable

Long-term debt

Inventory

Common stock

Plant and Equipment

shares outstanding, $ par)

Total

$0

Paid-in capital

Retained earnings

Totals

What will be the new price of the stock?

Problem 2

ABC Company
Balance Sheet
December 31, 20xx
Assets Liabilities and Equity
Cash Accounts Payable
Accounts Receivable Long-term debt
Inventory Common stock

Plant and Equipment

Total $0 Paid-in capital
Retained earnings
Totals $0

		( shares outstanding, $ par)
	What is the new price of the stock?

Problem 3

ABC Company
Balance Sheet
December 31, 20xx
Assets Liabilities and Equity
Cash Accounts Payable
Accounts Receivable Long-term debt
Inventory Common stock
Plant and Equipment ( shares outstanding, $ par)
Total $0 Paid-in capital
Retained earnings
Totals $0
What is the new price of the stock?

Problem 4

ABC Company
Balance Sheet
December 31, 20xx
Assets Liabilities and Equity
Cash Accounts Payable
Accounts Receivable Long-term debt
Inventory Common stock
Plant and Equipment ( shares outstanding, $ par)
Total $0 Paid-in capital
Retained earnings
Totals $0

What is the total cash dividend?